Disclosure Under Scrutiny: Alibaba's risk factors allegedly warned that other Chinese companies had been targeted as "Chinese military companies" while omitting that Alibaba's own MIIT affiliation placed it within the statutory definition.

Levi & Korsinsky, LLP notifies investors in Alibaba Group Holding Limited (NYSE: BABA) that a securities class action was filed on behalf of shareholders who purchased securities between June 26, 2025 and June 24, 2026. Submit your information now. You may also contact Joseph E. Levi, Esq. at jlevi@levikorsinsky.com or (212) 363-7500.

BABA ADSs traded as high as $173.68 on October 9, 2025 and closed at $95.07 on June 25, 2026, a decline of $78.61 per ADS, or approximately 45.26%. The lead plaintiff deadline is October 5, 2026.

What the Company Disclosed

SEC filings stated that "[s]ince 2020, the U.S. administration has issued executive orders prohibiting investments by any U.S. persons in publicly traded securities of certain Chinese companies that are deemed owned or controlled by the Chinese military," and identified three telecommunications issuers whose American depositary shares were delisted from the NYSE. Disclosure language in the same report also confirmed that the Company's online and mobile commerce businesses are classified as value-added telecommunications services requiring an operating license from China's Ministry of Industry and Information Technology.

What Plaintiffs Allege Was Missing

The complaint challenges the pairing of those two disclosures. Under Section 1260H(g)(2) of the National Defense Authorization Act for fiscal year 2025, an entity directly or indirectly affiliated with the MIIT falls within the statutory definition of a "Chinese military company." Plaintiffs allege the filings described the U.S. crackdown as a risk to other issuers while omitting that the Company's own MIIT licensing relationship placed it within that definition.

Disclosure Gaps Alleged

• No warning that MIIT affiliation could trigger designation under NDAA Sec. 1260H(g)(2), according to the complaint
• Risk language allegedly framed U.S. restrictions as affecting unnamed "certain Chinese companies" rather than the Company itself
• The 2026 annual report allegedly characterized "unauthorized distillation of third-party models" as a perceived, alleged, or inadvertent risk
• Plaintiffs contend that framing was inaccurate while conduct described by Anthropic PBC as "adversarial distillation" was allegedly ongoing
• Anthropic reportedly cited 28.8 million exchanges with its Claude model through nearly 25,000 fraudulent accounts
• Sarbanes-Oxley certifications attached to both annual reports allegedly attested to disclosure accuracy

Regulatory Reality

On June 8, 2026, the U.S. Department of Defense released an updated list of Chinese military companies that included Alibaba. ADSs fell $4.69, or roughly 3.9%, over two trading days to close at $115.38 on June 10, 2026. Following the June 24, 2026 Bloomberg report on the Anthropic allegations, ADSs fell $2.80 (2.7%) to $99.80, then $4.73 (4.7%) to $95.07.

"Generic risk factor language cannot substitute for disclosing specific, known problems already affecting a company's operations. The complaint alleges Alibaba's filings warned about a U.S. designation regime while omitting the Company's own exposure to it." -- Joseph E. Levi, Esq.

Find out if you might qualify to recover losses or call (212) 363-7500.

ABOUT THE FIRM — For over two decades, Levi & Korsinsky has represented shareholders in securities class actions. Ranked in ISS Top 50 for seven consecutive years. Investors who suffered losses have until October 5, 2026 to seek appointment as lead plaintiff.

Frequently Asked Questions About the BABA Lawsuit

Q: What is the BABA class action lawsuit about? A: A securities class action has been filed against Alibaba Group Holding Limited (NYSE: BABA) alleging materially false and misleading statements between June 26, 2025 and June 24, 2026. Shares fell approximately 45.26% from their Class Period high after the Company's inclusion on the U.S. Department of Defense list of Chinese military companies and reports that Anthropic PBC accused it of illicitly accessing the Claude AI model. Investors who purchased shares during the Class Period and suffered losses may be eligible to seek compensation.

Q: What court was the BABA class action filed in? A: The case was filed in the United States District Court for the Southern District of New York, governed by the Private Securities Litigation Reform Act of 1995.

Q: Who are the defendants named in the BABA lawsuit? A: The complaint names Alibaba Group Holding Limited and Chief Executive Officer Eddie Yongming Wu, who signed the Sarbanes-Oxley certifications attached to the Company's annual reports.

Q: What is the BABA lead plaintiff deadline? A: The deadline to apply for lead plaintiff appointment is October 5, 2026. This deadline applies only to investors seeking to serve as lead plaintiff. Class members who do not apply may still participate in any recovery without taking action before this date.

Q: What do BABA investors need to do right now? A: Gather brokerage records including purchase dates, share quantities, and prices paid. Contact Levi & Korsinsky for a free, no-obligation evaluation at jlevi@levikorsinsky.com or (212) 363-7500. No immediate action is required to remain eligible as an absent class member.

Q: What documents do I need to submit my information? A: Brokerage statements or trade confirmations showing purchase dates, share quantities, prices paid, and any subsequent sale dates and prices.

Q: What if I live outside the United States? A: U.S. securities class actions generally cover purchases on U.S. exchanges regardless of the investor's country of residence.

Q: What does it cost me to participate? A: There is no upfront cost to contact the firm. Securities class actions are generally handled on a pure contingency basis, with no retainer and no out-of-pocket costs. Any attorneys' fees and expenses awarded to class counsel are subject to court approval.

Q: What if I already sold my BABA shares -- can I still recover losses? A: Yes. Eligibility is based on when you purchased, not whether you still hold the shares. Investors who bought during the Class Period and sold at a loss may still be eligible to participate.

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